Consumers to pay surcharge of up to Rs14.24

Power companies will recover surcharge in installments over eight months

ISLAMABAD:

The National Electric Power Regulatory Authority (Nepra) has allowed power distribution companies (DISCOs) and K-Electric (KE) to recover the deferred fuel adjustment surcharge of up to Rs14.24 per unit from consumers.

Power companies will collect the surcharge in installments over eight months from March to October 2023.

They will recover Rs10.34 per unit from the protected domestic consumers using zero to 200 units per month, Rs14.24 per unit from the unprotected consumers using zero to 200 units, Rs14.24 per unit from those consuming 201 to 300 units and Rs9.90 per unit from the private agricultural consumers.

The government was required to pass on the fuel adjustment surcharge in the months of June and July 2022. However, Prime Minister Shehbaz Sharif deferred its collection.

In the case of KE, the power-sector regulator allowed the recovery of up to Rs13.87 per unit in fuel adjustment surcharge.

KE will collect Rs9.97 per unit from the protected domestic consumers using zero to 200 units per month, Rs13.87 per unit from the unprotected consumers using zero to 200 units, Rs13.87 per unit from those consuming 201 to 300 units and Rs9.90 per unit from the private agricultural consumers. KE will receive the surcharge from March to October 2023.

According to Nepra’s decision, the Ministry of Energy, while justifying its request, submitted that the rebasing of uniform tariff, determined by Nepra and recommended by it as a final tariff for publication in the official gazette, was notified by the federal government in order to not burden consumers disproportionately in the sequence of Rs3.5 per unit in July 2022 and Rs3.5 per unit in August 2022.

Consumers were hit simultaneously by the fuel charge adjustment of Rs9.8972 per unit and the rebasing of Rs7 per unit in August 2022 bills. It came to an average increase of Rs16.90 per unit over and above July 2022 rates.

These tariff adjustments significantly increased electricity bills of consumers for August and September 2022.

Moreover, extensive floods due to abnormal heavy monsoon rains also affected electricity consumers across the country. In that scenario, the prime minister decided to stagger the recovery of DISCOs and KE’s fuel charge adjustments, which were to be collected in August and September 2022.

In that regard, the regulator conducted a public hearing. During the hearing, the energy ministry reiterated that fuel charge adjustments, which were to be imposed in August and September 2022, were deferred for some category of consumers in order to provide relief, considering the base tariff revision and the impact of floods.

It highlighted that there was an average increase of Rs16.90 per unit over and above July 2022 rates and the tariff adjustments significantly increased electricity bills for August and September 2022. Moreover, the extensive floods due to abnormal heavy monsoon rains also affected consumers across the country.

During the hearing, electricity consumers strongly opposed the recovery of deferred surcharge and requested the regulator not to burden them with such a heavy increase in electricity tariff.

Published in The Express Tribune, March 11^th, 2023.

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